I’m often asked how I motivate myself to work in my own business and I explain it’s easy – in my computer I have my cash flow for the following twelve months, which pops up on screen every morning. A cursory glance at the imbalance between income and expenditure would encourage the most slothful person to find and complete work.
When I was in practice, I insisted my clients learned how to compile their own cash flows, for without that understanding they were doomed to make stupid and expensive mistakes. I used to love the magic moment when the penny dropped and they were well on their way to controlling their businesses.
Last week I was again persuading, cajoling and bullying a group of business people to understand their cash flows and it occurred to me that this simple concept ought to be taught in schools – starting with controlling pocket money and maybe developing to understanding the school’s finances, the parents’, the local hospital’s and so on. Educated in this way, perhaps business people would have the money for their tax demands, borrowers would understand the implications of repayment and fewer people might face insolvency.
I met a maths teacher who worked with remedial classes and had decided to arm the children with the mathematics that would help them cope with the real world. She taught them how to check a pay slip, electricity demands and other domestic bills.
She was reprimanded for not sticking to the syllabus. Well, I’m with her and just think how much wealth and happiness we could bring to the world if we trained our children to understand cash flows.
Oh sure there will always be those who choose to spend what they haven’t got – so be it – but let’s agree to stamp out the ignorance. Quite rightly Dorothy Boyd from the film ‘Jerry Maguire’ has been voted the most influential accountant of this century. You’ll remember she was always updating Jerry’s cash flow. A heroine indeed.
– Ann Baldwin, FCA, is a management trainer and conference speaker.
The drive towards a fully digital tax regime is an admirable one, but mandation is simply wrong, according to one of the UK's most senior tax technology practitioners - Paul Aplin
Barclays has partnered with accounting software company Xero to provide businesses with access to transaction data through its direct feed.
Government's estimate of a £400m admin saving from Making Tax Digital is way off - and is instead a huge cost burden, warns Lamont Pridmore chief executive Graham Lamont
Xero unveiled its expanded global partner programme at Xerocon South, the accounting technology conference in Australasia